Harold Ronald Hughes and Gigi Hughes v. Aames Funding Corporation d/b/a Aames Capital Corporation and Aames Capital Corporation, A California Corporation, and Wendover Funding, Inc., d/b/a Wendover and Wendover Funds, Inc.--Appeal from 288th Judicial District Court of Bexar County

MEMORANDUM OPINION
No. 04-03-00586-CV
Harold Ronald HUGHES and Gigi Hughes,
Appellants
v.
AAMES FUNDING CORPORATION d/b/a Aames Capital Corporation,
Aames Capital Corporation, and Wendover Funding, Inc.
d/b/a Wendover and Wendover Funds, Inc.,
Appellees
From the 288th Judicial District Court, Bexar County, Texas
Trial Court No. 2003-CI-04243
Honorable David Berchelmann, Judge Presiding (1)

Opinion by: Sarah B. Duncan, Justice

Sitting: Catherine Stone, Justice

Paul W. Green, Justice

Sarah B. Duncan, Justice

Delivered and Filed: October 27, 2004

AFFIRMED IN PART; REVERSED AND REMANDED IN PART

To settle their longstanding dispute over Aames Capital Corporation's foreclosure of its lien on the home of Harold Ronald Hughes and Gigi Hughes, Aames, by letter dated July 8, 1999, offered to sell the property to the Hughes for $34,000 on or before July 15, 1999. By letter dated July 13, 1999, the Hughes accepted Aames' offer, promising to deliver a cashier's check or certified check made payable to Aames by the afternoon of July 13, 1999. The closing, although extended to August 13, never occurred; and, on September 13, 1999, Aames sold the home to Peter Estevez. Thereafter, the Hughes sued Aames for breach of contract, fraud in real estate, interference with contractual relations, and conspiracy to commit fraud and interference with contractual relations. Aames moved for a no-evidence and a traditional summary judgment. The trial court granted Aames' motion.

1. The Hughes first argue the trial court erred in granted summary judgment against them on their claim for breach of contract because, contrary to the assertions in Aames' motion for summary judgment and brief in this court, there is evidence that Aames breached the contract; the Hughes were ready, willing and able to close; and the Hughes were prepared to tender a cashier's or certified check to Aames on the date set for closing. We agree.

To recover for a breach of contract, a plaintiff must establish "(1) the existence of a valid contract; (2) performance or tendered performance by the plaintiff; (3) breach of the contract by the defendant; and (4) damages sustained by the plaintiff as a result of the breach." Eckland Consultants, Inc. v. Ryder, Stilwell Inc., No. 01-01-00194-CV, 2004 WL 1471634, at *5 (Tex. App.-Houston [1st Dist.] July 1, 2004, no pet.). Aames moved for summary judgment on the grounds that the Hughes had "no evidence that Aames breached the terms of the contract" or that the Hughes were "ready, willing and able to close at any time." However, as set forth in the Hughes' brief, Gigi Hughes stated in her affidavit filed in support of the Hughes' response to the motion for summary judgment as follows:

My husband and I had obtained financing to purchase the Premises, had signed releases and orders of dismissals of this suit and were driving to Austin, Texas to close at the title company selected by Aames. We were then contacted by Aames' agent, Kim Chase, that we would have to have a certified check for $4,200.00 for payment of taxes that Aames had not paid. We were never informed previously that we would have to have any sums in addition to the purchase price of $34,000.00. We were told by Aames' agent, not to come to closing if we did not have the check. We turned around and drove back to San Antonio because we did not have the check for $4,200.00 because it was not included in the purchase price of the Agreement, and we wold [sic] not have entered into the Agreement for apurchase [sic] price of$38,200.00 [sic].

In its brief in this court, Aames states that "[t]he Hughes make a legal conclusion, a conclusionary statement, and speculate that Kim Chase is the agent for Aames," while "the uncontroverted evidence provided by Gigi Hughes in her affidavit is that Kim Chase, an employee of the closing title company, contacted the Hughes to inform them that an additional $4,200.00 would be required to close due to outstanding property taxes." However, Gigi Hughes' affidavit refers to Kim Chase not as the title company's agent but as "Aames' agent"; and the affidavit purports to have been made on Gigi Hughes' personal knowledge. There is no other summary judgment evidence regarding Chase's employer. We therefore hold the trial court erred in granting Aames' motion for summary judgment on the Hughes' breach of contract claim.

2. The Hughes next argue the trial court erred in granting summary judgment on their claim for fraud in a real estate transaction under section 27.01 of the Texas Business and Commerce Code. We again agree. "A cause of action for statutory fraud differs from the common law cause of action only in that it does not require proof that the false representation was made knowingly or recklessly." Robbins v. Capozzi, 100 S.W.3d 18, 26 (Tex. App.-Tyler 2002, no pet.). Accordingly, to prevail under section 27.01, " a plaintiff must show (1) a representation of a material fact was made, (2) the representation was false, (3) the representation was made to induce a person to enter a contract, (4) the person relied upon that representation in entering the contract, and (5) the false representation caused an injury." Id. Aames moved for summary judgment on the Hughes' section 27.01 claim on the ground that the Hughes "have no evidence ... of the falsity of any representation allegedly made by Aames." (2) However, Gigi Hughes' affidavit establishes that Aames made a material representation that it would sell the property to the Hughes for $34,000; and this representation was rendered false by the demand by "Aames' agent," Kim Chase, for an additional $4200. We therefore hold the trial court erred in granting Aames' motion for summary judgment on the Hughes claim under section 27.01 for fraud in a real estate transaction.

3. The Hughes next argue the trial court erred in granting summary judgment against them on their claim for tortious interference with contractual relations. "The elements of tortious interference with an existing contract are: (1) that a contract subject to interference exists; (2) that the alleged act of interference was willful and intentional; (3) that the willful and intentional act proximately caused damage; and (4) that actual damage or loss occurred." Trilogy Software, Inc. v. Callidus Software, Inc., 143 S.W.3d 452, 470 n.17 (Tex. App.-Austin 2004, no pet. h.). Aames moved for summary judgment on the ground that "[t]he alleged contract between Aames and Hughes expired on July 15, 1999." On appeal, the Hughes concede that "they cannot assert a tort claim for interference with contractual relations with Aames who is a party to the Contract." However, they argue, in their response to Aames' motion for summary judgment, they adduced evidence of another contract - that of the contract with Hughes' lender. In response, Aames argues "[n]o such contract has ever been produced and their mystery lender or lenders have never been identified by name. In addition, there are no pleadings to support such a cause of action." However, the Hughes' assertion is supported by the statement in Gigi Hughes' affidavit that "Harold and I did have a contract with a lender to provide financing of the entire purchase price on August 13, 1999." And Aames failed to raise the pleadings issue in the trial court; it may not therefore rely on this issue on appeal. See City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 677 (Tex. 1979) ("both the reasons for the summary judgment and the objections to it must be in writing and before the trial judge at the hearing"). We therefore hold the trial court erred in granting Aames' motion for summary judgment on the Hughes' tortious interference claim.

4. The Hughes next contend the trial court erred in granting summary judgment against them on their claim for conspiring to commit fraud and interference with contractual relations. "[A] civil conspiracy is a combination by two or more persons to accomplish an unlawful purpose or to accomplish a lawful purpose by unlawful means." Firestone Steel Prods. Co. v. Barajas, 927 S.W.2d 608, 614 (Tex.1996). "The essential elements are: (1) two or more persons; (2) an object to be accomplished; (3) a meeting of minds on the object or course of action; (4) one or more unlawful, overt acts; and (5) damages as the proximate result." Massey v. Armco Steel Co., 652 S.W.2d 932, 934 (Tex. 1983). Aames moved for summary judgment on the Hughes' conspiracy claim on the ground that the Hughes "have no evidence that there was a specific intent between Aames and any other party to accomplish an unlawful purchase [sic] or to accomplish a lawful purpose by unlawful means." In response, the Hughes argued Gigi Hughes' affidavit "proves a link between Aames and Esteves [sic] where they combined to threaten the lives and safety of the Hughes and their children by threats of murder and kidnaping to get the Hughes to drop this suit." Gigi Hughes affidavit provides as follows:

The facts that support the Hughes' claim for conspiracy between Aames, Wendover and Estevez are that Peter Estevez made repeated threatening telephone calls threatening to kill me [sic] my husband and to kidnap my children if we did not drop our lawsuit. Mr. Estevez stalked me and my children by following us home from school, driving beside us and yelling profanities and threats, and parking outside of our home. Aames conspired with Estevez because, an agent of Aames telephoned me and stated that "Estevez was connected with the mob, and that our lives were in danger" and that he knew we "won't continue trying to tie up the property with Estevez like you did with Aames."

The Hughes argue this is circumstantial evidence that, coupled with the fact that Aames refused to sell to Hughes and instead sold to Estevez, raises a fact issue regarding whether Aames and Estevez conspired to interfere with the Hughes contract with their lender. In its brief on appeal, Aames asserts these statements "are nothing more than fanciful, subjective beliefs." We agree. See Texas Division-Tranter, Inc. v. Carrozza, 876 S.W.2d 312, 314 (Tex. 1994) ("subjective beliefs are no more than conclusions and are not competent summary judgment evidence"). We therefore hold the trial court correctly granted summary judgment against the Hughes on their conspiracy claim.

5. Finally, the Hughes argue the trial court erred in granting Aames' motion for summary judgment on their intentional infliction of emotional distress claim because it was not encompassed by Aames' motion. We agree. Lehmann v. Har-Con Corp., 39 S.W.3d 191, 200 (Tex. 2001) ("if a defendant moves for summary judgment on only one of four claims asserted by the plaintiff, but the trial court renders judgment that the plaintiff take nothing on all claims asserted, the judgment is final-erroneous, but final").

We affirm the trial court's summary judgment insofar as it grants a summary judgment to Aames on the Hughes' conspiracy claims. However, we reverse the summary judgment insofar as it grants summary judgment in favor of Aames on the Hughes' breach of contract, fraud, and tortious interference claims because the Hughes produced more than a scintilla of competent summary judgment evidence on the challenged elements. We also reverse the trial court's summary judgment against the Hughes on their intentional infliction of emotional distress claim because this claim was not encompassed by Aames' motion. We remand the cause to the district court for further proceedings consistent with this opinion.

Sarah B. Duncan, Justice

1. Although the Honorable Lori D. Massey is the presiding judge in the 288th Judicial District Court, the Honorable David Berchelmann, presiding judge in the 37th Judicial Court, signed the judgment.

2. Aames also alleged the Hughes had "no evidence that AAMES did not intend to comply with the terms of closing the transaction [and] have no evidence that AAMES' [sic] plan to refuse to honor its obligations." However, as noted above, a cause of action under section 27.01 "does not require proof that the false representation was made knowingly or recklessly."Robbins v. Capozzi, 100 S.W.3d at 26.